More than eight in ten, or 81%, of respondents to the 2024 Central Banks Gold Reserves survey said they expect reserve managers to continue to increase their gold holdings in the next 12 months. This data, released by the World Gold Council, reflects the highest confidence level recorded since the survey began in 2019.

Despite high gold prices and two successive years of record central bank purchasing, nearly 30% of central banks plan to add to their own gold reserves within the next year. This trend highlights a persistent favourable view of gold among reserve managers, who see the precious metal as a hedge against political and economic uncertainty.

Further, although seven in ten, or 71%, still view gold’s legacy as a reason to hold it, other reasons have surpassed it this year.

The top three reasons to hold gold now include the metal’s long-term value at 88%, its performance during crises at 82%, and its role as an effective portfolio diversifier at 76% of respondents.

Additionally, central banks in emerging markets and developing economies (EMDE) maintained their positive outlook for gold’s future share in reserves portfolios.

Notably, EMDE central banks were joined by advanced economy central banks which now view gold more positively. More than half, or 57%, of advanced economy central banks said gold would account for a higher proportion of reserves five years from now, which is a significant increase compared with 2023 when 38% of respondents indicated the same view.

Advanced economy central banks have also become more pessimistic in their outlook for the US dollar’s share of global reserves, a view which has consistently been more prominent among EMDEs, the World Gold Council said.

More than half, or 56%, of advanced economy respondents believe the US dollar’s share of global reserves will fall, which is up 10 percentage points year-on-year, while 64% of EMDE respondents share the same view.

“Extraordinary market pressure, unprecedented economic uncertainty and political upheavals around the world have kept gold front of mind for central banks. Many of these institutions have become more aware of the asset’s value as a way to manage risks and diversify their portfolios,” said World Gold Council central banks global head and Asia-Pacific head Shaokai Fan.

“What has been remarkable is that, despite record demand from the official sector in the past two years, coupled with climbing gold prices, many reserve managers still maintain their enthusiasm for gold. While influences like price may temporarily slow down purchases in the near term, the broader trend remains in place because managers recognise gold’s role as a strategic asset in the face of ongoing uncertainty,” he said.